early possession
Can Buyers Move Into the House Before Closing?
Do you think it’s a good idea to let buyers move into the house before closing? Is there ever a good time or reason to give home buyers early possession of a home? I suppose the opinion greatly depends on which side of the fence you sit. If you’re a buyer, absolutely, you may develop an unexpected need for early possession right away, especially if you have to move out of your home before the closing of your new home. You don’t see anything wrong with it.
Hey, I’ve been there. I recall moving out of an apartment in Edina, a suburb of Minneapolis, the last apartment I ever lived in 25 years ago, and buying a home via a land contract of sale by the lakes in south Minneapolis. Went to closing, signed all of the documents, deposited funds and went home to finish packing. The sellers suddenly developed seller’s remorse and refused to sign closing documents. I sent a letter demanding they perform in accordance with the purchase contract, and I moved into the house anyway, without their permission.
This is not something I recommend. This is actually called trespassing. It is against the law. In my case, it worked, and the sellers signed. But it could have backfired. Just sayin’. Don’t you do this.
Yet, in an escrow that closed yesterday for a home in Antelope, the buyer’s agent asked for permission to let the buyers move into the house before closing. Their lender told them the transaction would close on Wednesday. Nobody checked with escrow, though. We had a last-minute glitch because M&T Bank had abruptly transferred the mortgage to trustee lawyers to begin foreclosure proceedings, even though the bank knew we were scheduled to close. That meant we were required to get an updated beneficiary demand from the trustee lawyers, and they could not possibly turn around that request in fewer than two days.
This is one of the problems with our lending institutions. So many banks tend to operate with internal systems and departments that do not communicate with each other. It’s like they keep separate files in each department, and the computer software systems can’t track a loan throughout the bank. Crazy to imagine that banks are that disorganized and screwed up but they are. I see it first hand all of the time, especially with short sales.
Can buyers move into the house before closing? I advised the sellers against it, but then laid out the pros and let them decide. After all, the buyers did pay for and complete all of the pest work prior to closing. The buyers also paid out-of-pocket to have the carpeting professionally shampooed. Their money had been deposited into escrow. They had signed all documents. But there was still a risk, and the sellers said, sorry, no. Sellers’ call.
When we were in a position to close 2 days later, the buyer’s agent sent an invoice from the movers for unpacking and repacking the truck. The buyers asked the sellers to reimburse them for that additional expense. I know what you’re thinking. We thought the same thing. People never cease to amaze. Further, that action solidified the decision not to let the buyers move into the house before closing. No regrets there.
Should Sacramento Home Sellers Give Early Possession to Buyers?
My cat, Pica, has a one-track mind when it comes to communicating what he wants. His focus is crystal clear, because he asks for only one thing. It’s never food nor treats nor pets nor playtime that he begs for, perhaps because those requests are often ignored, especially when I am working, which is most of the day for at least 5 days a week. The one thing that he truly wants above all else in life is to go outside, and that’s the one thing he cannot do. Fortunately, he is not traumatized by his inability to access the forbidden and, after I acknowledge his efforts, he will realize defeat and go roll happily in a sunny spot.
The funny part is if he does slink outside, soon as he is outside he wants to come back inside. After he gets what he thinks he wants, he doesn’t want it anymore. I don’t want him stolen or lost or runover by a car or beat up by skunks, so he stays in the house. We once let him out on our back steps, where we could supervise, but he stooped to give a ride to those hitchhiking fleas with their little flea thumbs stuck out — which quickly spread throughout the house and to our other 2 cats. That’s when the law was laid down — no outside. Ever. Period. End of Story.
There are some things in life that are just not a good idea to do. Like sticking a fork in an electrical outlet to see what happens or giving a home buyer early possession.
An agent called last week to ask if her buyers could have early possession of a home, prior to closing. This particular home is a Bank of America FHA short sale, which means it will take a long time to get approval, even after receipt of the Approval to Participate. The tenants moved out, the home is empty, and the buyers would like to move in and rent back from the seller.
Apart from the fact there can be no agreements between the parties that are not disclosed to the bank, and apart from the fact the seller cannot make a profit in a short sale, early buyer possession is a bad idea. I’ve been in this business almost 40 years, and there is rarely a benefit to early possession for the seller. There is liability, tons of it, and there is also the possibility the buyer might decide after moving in that the home, for whatever reason, that the home is not to the buyer’s liking.
When I represent the seller, the time we want a buyer to realize that maybe the purchase was not right is after the transaction has closed, and the buyer’s feet are up on the coffee table in front of the television in the living room of the home that now belongs 100%, hook, line and sinker, to the buyer.
If you’re interested in finding out how much your home is worth today, call your Sacramento real estate agent, Elizabeth Weintraub, at 916.233.6759.